As usual, I'll be covering all the breaking political news, as well as looking at the papers and bringing you the best politics from the web. I'll post a lunchtime summary at around 1pm and another in the afternoon.

And if you're a hardcore fan, you can follow @gdnpoliticslive. It's an automated feed that tweets the start of every new post that I put on the blog.

Photograph: Dave Thompson/PA

8.57am: Peers defeated the government three times on the welfare bill last night. In the most important vote, peers rejected the government's plan to means test employment and support allowance (ESA), a disability benefit, after a just a year. Instead the Lords voted for means testing to come in after two year, despite ministers warning that this could cost £1.6bn over five years. Chris Grayling (left), the employment minister, was on the Today programme this morning responding for the government. Here are the main points he made. I've taken the quotes from PoliticsHome.

• Grayling confirmed that the government would seek to reverse the defeats when the bill returns to the Commons.• He defended the plan to means test ESA after a year.

I think there is a really important principle here. What we're saying is not that the welfare state is not going to be there for those people who have got genuine need. Of course it is. Those people who have no other form of income will continue to receive support from the state, not just through employment and support allowance, but through other benefits as well.

But the question is where people have got other means of income, they've got other money coming into the household, they've got thousands of pounds of savings in the bank, is it not reasonable to [extend to] employment and support allowance a principle that already exists for jobseekers allowance, which is that you get something back in recognition of the contributions that you've made, but that something back cannot last indefinitely. What we can't do is provide support for people who've got other financial means.

• He denied that the Tories had been let down by the Lib Dems in the Lords. (Five Lib Dem peers rebelled, and 44 abstained.) Asked if Lib Dem MPs would support the government in the Commons, he said: "I've no reason to believe that's not the case."

• He claimed Labour's decision to oppose the government showed that they were not serious about welfare reform.

I am particularly disappointed by the attitude of the Labour party who last week were talking about the need to take tough decisions on welfare, but when it actually comes to it in the House of Commons or the House of Lords they won't take those decisions.

Photograph: Olivia Harris/Reuters

9.19am:Nick Clegg, the deputy prime minister, has been speaking today about the way he has got more than 100 firms to sign up to a code of good practice on making work experience opportunities freely available. You can read the Guardian story about it here, the Cabinet Office press notice here and details of how the "business compact" will actually work here. • Clegg claimed that his work experience initiative would make a real difference to the lives of children from underprivileged backgrounds.

There are lots of children at school for whom working at some of these big companies that have signed up to the deal we're talking about today, it just seems like something in another world, for other people ... When people from those companies come into their classroom and say, 'This is something for you as well, you can dream the dream of actually doing well in business', that opens horizons and it's immensely important we get that bridge between businesses and schools.

But Clegg has also been talking about Scotland and Europe. Here are the key quotes, which I've taken from PoliticsHome.

• Clegg accused Alex Salmond of being "slippery" on the issue of independence.

Sometimes I get the impression [Salmond] thinks it's all about him. It's not, it's about the people of Scotland, and I think an increasingly, so, Scotland within the United Kingdom is the best thing to deliver jobs and prosperity for the people of Scotland.

• He said that, despite David Cameron's veto, Britain could still sign up to a new EU treaty designed to deal with the problems facing the eurozone.

I think eventually, as long as there are clear safeguards which guarantee that financial services and so on in the United Kingdom are properly protected in the single market, I think the basic view, which was a government view running up to the last summit, that all 27 countries should try and work together to help fix the eurozone is something which I think is as true now as it was then.

9.34am: And while we're talking about Scotland, MSPs in the Scottish parliament are now debating a Labour motion saying Alex Salmond should hold immediate talks with leaders from civil Scotland about the timing of a referendum on a single question. You can watch the proceedings on the BBC's Democracy Live website. BBC News are showing it live too.

Johann Lamont, Labour's leader in Scotland, opened the debate. I've never seen her speak before, but she was good - feisty and funny. I'll post some quotes from it in a moment.

Photograph: Andrew Milligan/PA

9.40am:Johann Lamont (left), Labour's leader in Scotland, opened the debate in the Scottish parliament demanding immediate talks on an independence referendum. Here are some extracts from her speech.

When it comes to constitutional change, where Donald Dewar delivers, four months two years, Salmond dithers and we're going to get at least another 1,000 days. What's he frightened of? He can get any legislation, he tells us, past this parliament. He has a mandate, he has a majority. Surely it cannot be that he does not have the courage to face the verdict of Scottish people ...

He is Moses who has led his people to the brink of the Promised Land. But, as they view it from the mountain top, he says to them: "Let's camp outside for a few more years before we go in." And bizarrely, at the end of today's proceedings, the only party voting against a legal, firm and decisive referendum held soon is the SNP.

Thank goodness Mr Salmond never decided to go into medicine. We can imagine the good doctor Salmond telling his patients: "The good news is I have found a cure for your illness. The bad news is I'm not going to administer it until half way through your treatment.

She also said it was not fair for Salmond to be in the charge of the timing of the referendum. When Labour set up the parliament, it instituted fixed-term parliaments to stop the governing party being able to fix the date of elections.

Photograph: Murdo MacLeod

9.55am: And here are some extracts from Alex Salmond's reply to Lamont in the Scottish parliament debate. He started off by attacking Labour for voting in favour of 16 and 17-year-olds being allowed to vote in the alternative vote referendum, but opposing the SNP's plan to allow this for the independence referendum. When Lamont was challenged about this in her speech, she said the SNP government had not introduced voting at 16 for Scottish local government elections. But the Scottish government did not have the power to do this, Salmond said.

In that revealing insight we find the reason why the Labour party has so much difficulty. They do not even know how limited the powers of this parliament are.

Salmond said he was opposed to Westminster organising the referendum because he remembered how the "40% rule" (a threshold saying 40% of those eligible to vote had to support devolution for it to happen) derailed devolution in 1979.

Winnie Ewing encapsulated the point when she said once upon a time Britannia ruled the waves. Now it waives the rules.

Salmond said Lamont wanted cross-party talks on a referendum. But Labour were already talking to the Conservatives about this, he said. Yesterday David Cameron told Ed Miliband he agreed with him 100%, Salmond said.

Let me warn the Labour party. If they go in with the Tories, they will suck you in and they will spit you out, as they have done to the Liberal Democrats. Rather than have this cross-party alliance between Labour and the Tories at Westminster, let's have the people of Scotland, in a considered and proper way, in the consultation document that we will debate ... move towards a referendum built in Scotland, made in Scotland, produced by this parliament, and then offered to the people of Scotland in their wisdom.

He also accused Labour of being inconsistent on the timing of the referendum.

When Johann Lamont suggested we weren't consistent on this issue, I thought to myself, could it possibly be that the party that said no referendum, then said bring it on, and then went back to no referendum, and then wants a referendum immediately - I don't think we can take lessons of consistency from the Labour party on this particular issue.

The fact this is, in general, an entirely artificial injury, is shown by the stunning variation in levels of compensation, and the number of claims per head of population for whiplash. Internationally, we have infinitely weaker necks than any other country in Europe, but moreover within Britain, people in the north west, my area, have much, much weaker necks than those in Scotland, just across the border, because it's much more difficult to get compensation. It is awful and in my judgement the select committee are quite right to say, yes we've got to improve the regulation of this, but there has to be changes in the law.

When [Heywood] was appointed there was speculation as to whether he would keep his old desk right outside David Cameron's room, or migrate to the Cabinet Office where the traditional, wood-panelled cabinet secretary's office – faithfully reproduced for Sir Humphrey Appleby on the set of Yes, Minister – can be found.

Sir Jeremy wisely chose to keep both offices. "He'll float like the Mekon between them," said one insider. Colleagues are taking bets as to how much time he'll spend in each place.

Recent analysis published by Financial Times Research shows that Scotland is the "most prosperous" part of the UK outside London and the South East of England, in terms of the 12 nations and regions of the UK. Scotland's economic output (Gross Value Added per head of population in 2010) is 99 per cent of the UK average. The highest is London at 171 per cent, and the lowest is Wales at 74 per cent.

Taking all Scottish revenues and spending into account – including financial sector interventions – the official Government Expenditure and Revenue Scotland statistics show Scotland has run a current budget surplus in four of the five years to 2009/10, while the UK was in current budget deficit in each of these years, and hasn't run a current budget surplus since 2001/02.

All in all, Alex Salmond may have prepared well for the fight of his life, but while he undoubtedly sees himself as some form of messianic figure, leading Scotland to what he calls "freedom", it is he who blinked first in this constitutional stand-off with London – by naming the date he wants his referendum to be held on, something he wasn't prepared to do yet.

This over-confidence in his own abilities and often disastrous judgment caused him to be spectacularly wrong over issues such as the Scottish banks' collapse and his plan to get Scotland to match the "arc of prosperity" – the now bankrupt countries such as Ireland and Iceland.

These traits, allied to an explosive temper and an incredibly thin skin, may yet lead to his ultimate undoing in what has become the Battle for Britain.

David Cameron has won some respite in his battle to stop the eurozone laying down terms on the European Union single market and new rules for Britain's financial services sector, according to the latest draft of a new treaty on fiscal discipline in the single currency area.

The text, obtained by the Financial Times, deletes a section in an earlier version, demanded by France, that committed signatories to forge closer co-operation towards a single market – something normally the province of the EU treaties and all 27 member states.

Downing Street expressed relief at the latest draft. Mr Cameron's aides believe that free market allies such as Germany, the Netherlands, Sweden and the European Commission have succeeded in ensuring that all single market decisions are taken by the entire EU, including Britain.

11.29am: Andrew Dilnot, the St Hugh's College Oxford principal and former presenter of Radio 4's More or Less, has been appointed as the new chair of the of the UK Statistics Authority, the Cabinet Office confirmed today.

11.33am: A new poll shows a small increase in support for Scottish independence in Scotland since last April. This is from the Press Association.

A third of Scots support the country leaving the United Kingdom, according to the latest poll.The same survey also found that a third of voters in England and Wales back independence for Scotland.The YouGov poll for the Sun showed that 33% of Scots who were questioned backed independence, while 53% were against, with 14% undecided.Amongst voters in England and Wales, again 33% said they backed Scotland leaving the United Kingdom.But the number of people opposed to this was lower than north of the border, with 37% of English and Welsh voters saying "no" when asked if they supported Scottish independence. A total of 30% of those questioned were undecided on the issue.This latest poll shows support for independence amongst voters north of the border is higher than it was shortly before the Scottish National Party's landslide election victory last May.A YouGov poll in April found 28% of those surveyed backed independence, with 57% against.

Angus Robertson, the SNP MP and director of the SNP's referendum campaign, said: "This is a very welcome poll, confirming that support for independence is continuing to grow."

Photograph: Suzanne Plunkett/Reuters

11.48am: It is not just pensions in the public sector that are more generous. According to a news release from Francis Maude, the Cabinet Office minister, public sector employees also have 16% more office space per empoyee than private sector employees.

That is one of the figures contained in new data being published today about the property and land owned by central government. The data files are here. Maude says that this is the first time that information has been published in such detail and that being open in this way will help the government to save money.

Introducing greater transparency has not only shown the true scale of what we own or lease, it has enabled us to see the scope for savings and to push ahead with making them.

In his news release, Maude also says that the government has saved more than £100m in this financial year through better management of its property estate. This is what the Cabinet Office says about how the savings have been achieved.

The savings are from the national property controls, which include a requirement for Cabinet Office approval for all new leases and property acquisitions, and surplus buildings being examined for sub-letting or sale. Space is also used more effectively – for example, Cabinet Office staff led the way by moving into the Treasury building earlier this year, which was the first major example of co-location in Whitehall.

Photograph: KeystoneUSA-ZUMA/Rex Features

12.03pm:Boris Johnson is today promising to deliver a new tunnel under the Thames in the east of London within the next 10 years. According to the Press Association, the proposed tunnel, between the Greenwich peninsula and Silvertown in the Royal Docks, will have a capacity of 2,400 vehicles an hour in each direction, and will relieve pressure on existing tunnels at Blackwall and Rotherhithe to the west.

This is what Johnson said in a statement.

When I look at London I see a city of incredible potential and tonight I will make the case for a huge new phase of investment in the capital, including a major new river crossing east of Tower Bridge. We are in the right time zone, speak the right language and have the young, skilled population to continue to attract investment from the world's greatest businesses. This is not a time for London to falter it is a time for London to flourish.

12.13pm:Alex Salmond, Scotland's first minister, has been taking questions in the Scottish parliament. Johann Lamont, the Labour leader, asked if Salmond would work with the other parties to agree a way forward on the nature of the independence referendum. Salmond said she would be "pleasantly surprised" by the consulation document being published by the Scottish government soon.

It is in the interests of, not just the governing party, it's in the interests of this chamber, it's in the interests of Scotland - as I think will be clear from our consultation document - that the process is clear and transparent and does this nation proud. And I assure her, when she sees the consulation document, I think Johann will be reasonably surprised and perhaps encouraged the tone of it.

Salmond also said that the Scots did not want politicians to pre-judge what should be on the ballot paper. There should be a consultation, he said.

We'll bring forward a consultation document which will be genuinely that, which certainly will put forward our views, but one that's prepared to listen not just to the political parties in this chamber, but right across the spectrum of Scottish society, so that we can have a referendum of which we can be proud, a debate of which we can be proud, and all people will know that they've had their full opportunity to contribute to that process.

Salmond also said that Labour was "in cahoots" with the Conservatives on this issue.

I'm a great student of body language and I was watching the Labour benches [in Westminster] and every time the Conservatives said how they were standing shoulder to shoulder in this debate, there was a lot of discomfiture on the Labour benches. I think there will be a lot more as we see the extent of the claims of their colleagues at Westminster about how they've been working hand in hand with the Tory government at Westminster in order to bring forward diktats to this parliament and the people of Scotland.

12.50pm: It's taken a while to get a text of Chuka Umunna's executive pay speech, but it's now arrived. I'll post a summary once I've read it.

1.20pm: Here's a lunchtime summary.• Alex Salmond, Scotland's first minister, has said that the SNP's critics will be "pleasantly surprised" by the tone of the Scottish government's forthcoming consultation on an independence referendum. It would be a genuine consultation, he said. The Scottish government wanted to listen to the views of "the spectrum of Scottish society" about the terms of the referendum. In a debate in the Scottish parliament, he also said that Labour's decision to form a pro-union alliance with the Tories would backfire. "Let me warn the Labour party," he said. "If they go in with the Tories, they will suck you in and they will spit you out." (See 9.40am and 9.55am.)•Ministers have vowed to reverse the triple defeat in the Lords over plans to cut benefits for people with disabilities. Chris Grayling, the employment minister, said last night's votes showed that Labour was not serious about welfare reform. "Our welfare reforms are essential and will see help going to those who most need it," he said in a statement. "Yet all we get from Labour is more knee-jerk opposition to our reforms with no alternative." Downing Street has also revealed that the government may, after reversing the key defeat in the Commons, use a rare procedure to stop peers voting on it again. By designating the cut in employment support allowance as a financial measure (because of the large sums of money involved), ministers could stop peers voting on it - because the House of Lords does not have the power to reject budgetary measures.

• The Independent Parliamentary Standards Authority has released fresh details of MPs' expenses claims that were rejected. As the Press Associaiton reports, some 27,000 claims worth £3.5m were approved by Ipsa in August and September last year. But 52 claims from 41 MPs - worth £941.22 in total - were knocked back, in part or in full, because they did not meet its criteria for reimbursement by the taxpayer. The biggest claim to be rejected came from Conservative Erewash MP Jessica Lee for a £166.26 electricity bill for her constituency office. Ipsa said she had provided insufficient evidence to support the claim.

Photograph: PR

1.44pm: One of my theories about political news is that the best speeches - ie, the cleverest, or most interesting - are the ones that receive least attention. Today's speech on executive pay from Chuka Umunna (left), the shadow business secretary, is a very good example. I haven't heard it mentioned on the BBC or Sky all day and, in news terms, that's not surprising. Last week, late on Friday, Umunna put out a statement saying that Labour would accept in full the recommendation of the High Pay Commission (presumably to pre-empt the announcement that David Cameron was going to make about executive pay at the weekend). It meant that there was not much new left for today. As a result, the BBC's report on the speech leads on Umunna's call for big shareholders to play a role in appointing company directors - the kind of story that is unlikely to make much more than a nib (news in brief) in the FT.

So why is the speech worth reading? Basically, because it's refreshingly intelligent, combining clear analysis, practical ideas and some good lines. It's also devoid of partisan, yah-boo slapstick. Umunna used to be a corporate employment lawyer and, on this subject, he clearly knows his stuff. The full text is on the Labour website. But here are the main points.

• Umunna praised the role of business. Noting that the FT is running a series on the theme "Capitalism in Crisis", he joked: "I wouldn't go as far as those dangerous lefties." He said he believed in business because he believed in the notion of mutally dependency and "better together".

Business and society are not separate islands - they are mutually dependent. Business needs a strong society, providing it with human resource, talent and custom. A strong society needs everything that productive business can offer: the jobs, the growth, the innovation, the opportunities, the wealth creating potential. That is why we should take an interest in the pay issue.

It is not unusual for Labour frontbenchers to say that they are pro-business. But Umunna really does sound as if he means it.

• He insisted that the excessive pay problem was not about individuals.

The growing gap between increases in pay and increases in company performance is systemic. In the last decade the value of FTSE 350 companies increased by eight per cent, while the average total earning of executives in those companies increased by one hundred and eight per cent.

• He said excessive pay was bad for business because rewards were not related to performance. The statistics on this have been well rehearsed, and this bit of his argument was by no means original, but I was particularly impressed by this passage, on non-financial rewards.

The heavy focus on the alignment of high powered incentives risks crowding out other, more rounded but equally powerful intrinsic motivations of executives that are just as relevant to the company's success – the satisfaction of doing a good job, the pride in leading and growing a great company, of winning in the market place, of having the respect of peers, of creating a legacy of sustained and sustainable success.

We are not opposed to performance related pay but it does make you wonder: if a company is so concerned that an executive paid only their salary won't be motivated to work hard in the best interests of the company, then maybe they have the wrong person in the job?

• He said excessive pay in the City was bad for the economy was a whole because it was dragging too many graduates into financial services.

• He said excessive pay was bad for society because it was fuelling inequality. Again, this argument is not original. But Umunna made his point by quoting not from the Spirit Level, but from the former chief economist at the IMF.

Today, I'll refer you to comments of the former Chief Economist at the IMF, Raghuram Rajan – the IMF is of course George Osborne's institution of choice when it comes to quoting people! He has argued that high levels of inequality contributed to the financial crisis. In his recent book, Fault Lines, Rajan explains how high levels of wage inflation at the top and wage stagnation for the rest of the population led to a growth in easy credit.

• He said that he wanted big shareholders to play a role in appointing members of company boards because the current system was "not conducive to the appointment of people who are prepared to shake it up".• He criticised the role paid by remuneration consultants - the advisers who recommend how much executives should be paid.

The role of remuneration consultants must be looked at, as the Commission says in its report. In his 2006 letter to Berkshire Hathaway shareholders, Warren Buffet referred to a remuneration consultancy called "Ratchet, Ratchet and Bingo"; "The name may be phony," he said, "but the action it conveys is not", highlighting his view that such consultancies inflate executive pay. There are widespread concerns that these consultancies are ratcheting up pay here too.

• He criticised the government for failing to accept that workers should sit on remuneration committee. This proposal was important, he said, because "it would mean top executives would have to look an ordinary member of staff in the eye before they award these pay packages".

• He said there were "large practical difficulties" with Cameron's plan to allow shareholders to have a binding vote on executive pay. The main problem was with the retrospective nature of these votes, he argued.

3.00pm: Here's an afternoon summary.

• MPs have begun debating a call for a statutory code of practice relating to pub companies and their licensees. Opening the backbench debate, Adrian Bailey, a Labour MP and chair of the Commons business committee, claimed there was "obviously something profoundly wrong within the industry" as he spoke of the closures of pubs around the country. As the Press Association reports, he said the current code of practice that governed the relationship between them was "heavily weighted in favour of the pub company". Many publicans, he said, worked very long hours with some earning less than £15,000 a year. "It's hardly surprising that many of them just give up and go elsewhere and the consequences of that are visible up and down the country as we see pubs closing day by day. And the consequences are not just on the publicans, they are on the local communities that they serve."

• Lady Tonge, a Lib Dem peer, has criticised Nick Clegg for agreeing to support the Conservatives' plans to cut welfare. She said there was "deep unease" amongst Lib Dem peers about the party's decision to back some of the measures in the welfare bill," she told the World at One. "I just don't know what's happening to Nick Clegg. He doesn't seem to be thinking straight nowadays."

• Richard Caborn, a former culture minister, has told MPs that the Daily Mail forced Labour to drop plans for multiple super-casinos. Giving evidence to the culture committee, Caborn said the government cut the proposed number of super-casinsos after opposition from the Daily Mail in the run-up to a general election. In April 2005, Tessa Jowell, the then culture secretary, conceded there would only be provision for one of the controversial complexes instead of eight. Asked if the concessions were a political decision, Caborn said:

There were two things. One is you've got a campaign run by a national newspaper - the Daily Mail - and the second thing, you were coming up to an election in 2005. That was the reality of it. Did you save the chunk of the bill, online gambling and all that, did you save all that and do a deal on wash-up?

• Matthew Hancock, a Conservative MP and a former chief of staff to George Osborne, has said that bankers should face prosecution if they behave recklessly. "I want to see a law which makes it possible to prosecute executives for serious financial recklessness," he said in a speech to Policy Exchange. "Our goal must be to make executives think harder about the consequences of their actions, and change the culture of finance so it is safer for us all."